Washington, D.C. – September 29, 2010 – The Brewers Association, WineAmerica, Distilled Spirits Council of the United States, Wine Institute, Beer Institute and the National Association of Beverage Importers jointly released the following statement at the House of Representatives Judiciary Committee hearing on H.R. 5034. The associations represent virtually all alcohol beverages sold in the 50 states.

“We oppose the recently revised version of H.R. 5034 as it undermines essential constitutional principles that prohibit enactment of discriminatory state laws. The existing federal and state alcohol regulatory system has evolved over more than 75 years, and the changes proposed in H.R. 5034 are unnecessary to maintain a well-regulated and orderly market for the sale and distribution of alcohol beverages.

“While we appreciate Rep. Delahunt’s efforts to narrow his originally-introduced H.R. 5034, we believe that the revised legislation still has many serious problems. By its very nature, the primary function of this legislation is to affirmatively permit states to pass discriminatory laws. Simply put, H.R. 5034 is bad legislation, bad public policy and bad for free enterprise.

“This measure harms consumer choice by putting brewers, wineries, distillers, importers, and retailers at a competitive disadvantage. States would have the power to enact unfair and protectionist laws against out-of-state beer, wine and spirits interests without judicial recourse.

“We fully support existing state alcohol regulatory systems that provide effective and efficient control that serves the interests of society and the marketplace as a whole. This unnecessary legislation would allow a variety of discriminatory state laws and would reverse decades of Supreme Court precedent while doing irreparable damage to a fair, equitable and well regulated marketplace.”

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Quotes from coalition members appear below:

“H.R. 5034 is special interest legislation intended to protect and enrich the wholesalers and their monopoly in distribution at the expense of wine consumers, retailers, importers and our nation’s 7000 wineries. Without justification, H.R. 5034 asks Congress to surrender its exclusive power over interstate commerce guaranteed by the Commerce Clause of the U. S. Constitution, opening the door to widespread state-based discrimination,” said Robert P. Koch, President and CEO of Wine Institute.

Contact:

Nancy Light, nlight@wineinstitiute.org, 415-356-7520

“This is special interest legislation that strips away fundamental protections of the Constitution and seeks a solution for a problem that doesn’t exist,” said Peter Cressy, President of the Distilled Spirits Council.

Contact:

Frank Coleman, fcoleman@discus.org, 202-682-8840

“This proposal, even after being amended, would result in less choice for consumers and serious disruption and discrimination in the marketplace. The current three-tier system is working well and brewers and beer importers strongly support it,” said Beer Institute president Joe McClain.

Contact: Beau Phillips, bphillips@clsdc.com, 202-495-1501

“If wineries fail to reach customers, that failure should be their own, not one imposed on them by the logistics of the distribution system. H.R. 5034 would create higher barriers to entry for thousands of wine brands,” said Cary M. Greene, Esq., Chief Operating Officer & General Counsel of WineAmerica.

Contact:

Cary M. Greene, Esq., cgreene@wineamerica.org, 202.478.7642

“H.R. 5034 carves out a federally legislated niche for states to trump the commerce clause which could ultimately work against the international balance achieved in the course of opening markets for US exports. Importers carefully comply with the thousands of state and local laws already in place. Encouraging further balkanization of these rules seems adverse to commerce and a threat to the overall vitality of this industry,” said William T. Earle, President of National Association of Beverage Importers.

Contact:

William T. Earle, nabipresident@gmail.com, 202 393-6224

“H.R. 5034 still seeks to 'fix' a system that is not broken and has worked well for decades. Smaller craft brewers are the fastest growing segment of our industry and that growth would be jeopardized if states are allowed to enact discriminatory laws," said Charlie Papazian, President of the Brewers Association.